CVS Health Stock Is Moving Higher Monday: What's Going On?

CVS Health Corporation CVS shares are trading higher Monday after the company announced the addition of four new directors to its board. Here’s what you need to know.

What To Know: CVS Health has appointed four new members to its board including Larry Robbins, Leslie Norwalk, Guy Sansone and Doug Shulman. The appointments come as a result of discussions with activist investor Glenview Capital Management, a major stakeholder.

The new board members bring varied expertise. Norwalk will join the Health Services Committee, Sansone will join the Audit Committee and Shulman will join the Management Planning and Development Committee. Robbins, who is the CEO of Glenview, will also join the board.

CVS Health’s board now consists of 16 members in total. CVS Health said the appointments are aimed at improving financial and operational performance and driving long-term value.

“Adding four experienced thought leaders to our Board further sharpens our focus on executing against our strategy to build a world of health around every consumer, as we improve total cost of care and customer experience in health care,” said David Joyner, president and CEO of CVS Health.

In connection with the appointments, CVS Health and Glenview entered into a confidentiality agreement with customary provisions regarding confidentiality, standstill arrangements and other related matters. The details of this agreement are expected to be filed in a Form 8-K with the U.S. Securities and Exchange Commission.

“We welcome the opportunity to join the Board, roll up our sleeves and lock arms with the Board and leadership team to drive long-term, sustainable value through continued customer-centric offerings, commitment to compliance and quality, disciplined underwriting and risk management, aligned incentives, and optimal capital allocation,” Robbins said.

“We appreciate the Board engaging with us on a cooperative basis that allows all energies to be productively dedicated towards further strengthening this iconic company.”

Following the board changes, Wells Fargo analyst Stephen Baxter upgraded CVS Health from Equal-Weight to Overweight, and adjusted the price target from $60 to $66.

CVS Price Action: CVS Health shares were up 5.55% at $56.13 at the time of writing, according to Benzinga Pro.

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